Monday, June 30, 2003

Boom Time Memories... Masayoshi Son Was The Man

Recently, my friend Jimmy and I were talking about the crazy days of the boom times and some of the funny experiences we went through. Jimmy is one of my closest friends and we have been in the trenches of entrepreneurship along with our friend and former colleague Peter. We've gone through starting a company on credit cards, savings, and the FM Fund ("Father Mother Fund" as we liked to call it); pitching hundreds of investors through two startups; dealing with the typical boom time dealmakers that can "wow" you one day and disappoint you the next; and the highs and lows of trying to establish partnerships and agreements.

We've been blessed to have great chemistry between the three of us and I look forward to starting another venture with them in the near future. Of course, we like to think our chemistry was due to the fact that all of us are relatively easy to work with and good-natured. Though we might have even yelled at each other in the board room, in the end the right decision was made and nothing was taken personally.

Anyway, one story we were talking about was when HeyAnita was securing its first round of financing from Softbank. Jimmy provided the initial introduction for the four ex-Microsoft guys, who founded HeyAnita, to Masayoshi Son. Though it was towards the tailend of the tech boom, Son's company, Softbank, was still flying high. At the time, Masayoshi Son was the second richest man in the world, after Bill Gates, with a value at more than US$60 billion (now he's around 10th with less than $10 billion).

Jimmy was in the meeting along with our colleague, who recruited us to HeyAnita, and the first member outside of the Microsoft guys. Our colleague was leading the pitch and asking for $30 million to startup this new voice technology company. After the demonstration, Son must have been impressed as he began to draw out a map of the world and continued to divide up the regions between HeyAnita and Softbank. When I heard this, I assumed this was something similar he did with Yahoo! when he made that investment that allowed the company to sky-rocket.

After some discussion of the terms, he said, "I will give you $5 million now and $25 million by the end of May."

Our colleague responded, "But we need the whole $30 million to start buying the necessary equipment."

"What type of equipment? And how much is it exactly?" Son asked.

"Servers, boards, etc. from Intel and some other companies. We definitely need at least $20 million."

"No. I will give you $5 million now. And then you tell Intel that Masayoshi Son backs your company and your credit and that will be good enough."

Maybe it's sheer power. Maybe it's sheer arrogance, but at that time it was impressive the power and command people like Masayoshi Son had. Those outside of the business world might just see this has uneventful or silly idolatry, but I don't see it as either one. For me, it is plain respect in what the man built and amusing how lopsided it sometimes was at the negotiating table during those times.